Ask your Realtor.
First, you could be "leaving money on the table," especially if those offers don't result in a bidding war. Example: Let's say your property (based on you and your agent's best estimates) is worth $400,000. But you price it at $370,000 to "attract many offers."
And you do get many offers--ranging from $365,000 to $380,000. Whoops. Your strategy "worked" with the multiple offers, but might have just cost you $20,000.
Then, again, you might not get multiple offers. You've priced it at $370,000, and you get a nice, full price offer of $370,000. Whoops!
Or you get those multiple offers. You're getting them from people who are probably qualified up close to the maximum of their offer. They might want to be able to offer more, but that person who offered $365,000 maybe can go up to $375,000. That person who offered $380,000? He might be stretching it as is. They may not be able to go up another $20,000.
Besides, you're not selling multiple items. You only need one buyer. Which would you rather have: 5 offers ranging from $365,000 to $380,000, or one offer at $400,000? I'd opt for the latter.
Now, pricing is an art and a science. We earlier said that your property was worth $400,000. That might be based on comps ranging from $390,000-$410,000. Maybe the market's hotter now, and you could get $410,000 for it. Maybe, strategically, you want to price it at $399,900. There are lots of things you can do within a reasonably narrow price range to maximize your sales price. Your agent can help you greatly there.
But would I deliberately price it low just to encourage multiple offers, hoping for a bidding war?
Hope that helps.
You should speak with a reliable, reputable pro in your area to see how this strategy will play out there.
Lance King/Owner-Managing Broker
King Realty Group
What is most important is to price your home at the appropriate price. Most traffic occurs in the first two weeks of your home being listed. One can easily loose a good buyer within the first two weeks and it can be on the market for longer than necessary if not appropriately priced.
You have asked a very relevant question here.
If you were a buyer, you would be attracted to the lower price, and come to view.
You would pay its value, and some more if it goes to bidding.
If it was price at the market value some of the buyers may not visit, and you may get less activity.
If you were to price above the market, you may attract buyers who otherwise, may have a hard time getting into a home due to lower down payment or such factors.
So, it will depend on how you would like to do it, and based on existing market conditions, which may change from time to time.
Good luck & let me know if you need further info.
Broker-Referral Realty Silicon Valley
I would try though to list it in $25,000 increments so I can atttract two groups looking on thr MLS, most people have their buying agents set them up on a listing watch on the MLS,, they usually say send me everything under EXAMPLE---600,000 or 575,000 or 550,000
If you do set your price at 600,000 you will get the buyers searching up to 600,000 and buyers seaching from 600,000 to 625,000----two groups.
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If you are not fluent in the art of jacking the price back up, you will have given away some of your equity, possibly unneccessarily.
Once the 'value' of your home has been determined. the price is used to compress the time requirement.
The right response to your question must be related to your selling urgency. That important piece is missing from your question.
A strong buyer's broker will not be intimidated by a bidding war. They'll see through the smoke and mirrors and urge their buyers to stay within their budget and at or below a reasonable target price.
Very few buyers will offer above market value, so creating a gaggle of meaningless low-ball offers just adds noise that Shakespeare would describe as:
"...a tale told by an idiot, full of sound and fury, signifying nothing." (Macbeth)
I hope this information is helpful. If there is anything further I can do to assist, please feel free to contact me:
Realtor/Code 3 Realty
Direct: 408 921-1661
"A Realtor You Can Trust: Committed to Service Excellence"
Whatever you do, engage you realtor in preparing a Comparable Market Analysis. Factor certain things that may affect your property value --- improvements, amenities, condition. Is your area considered hot, hot, hot?
Decide on your pricing strategy --- but don't overprice. Even in a sellers market, the top reason why properties don't sell or attract attention is over-pricing.
And...you may like the bragging rights of attracting many offers...but do you have time to wade through many offers just so you can say you received a lot?
If buyers/agents are going to write offers for significantly over list price, how many of them are going to waive their appraisal contingency? Many write higher offers, and when the appraisal comes in lower than offer price, they take that opportunity to haggle.
Be strategic, be smart. You only need ONE really good offer.